In March this year, we reported on a recent decision of the Queensland Civil & Administrative Tribunal (Tribunal) in which the Tribunal found in favour of the Montessori Children’s Foundation (Trustee) as trustee of the Masterman Montessori Indigenous Children’s Trust (Trust) that it was an institution within the meaning the Tax Administration Act 2001 (Qld) (Act) for the purposes the Queensland duties and tax legislation.

The Commissioner of State Revenue appealed the decision of the Tribunal to the Queensland Court of Appeal.

The Commissioner appealed the decision on the following 4 grounds; namely:

  • that the Tribunal had erred in the interpretation of the word “institution” in accordance with its technical, legal meaning in the legislation;
  • that the Tribunal had erred in law by failing to take into account relevant considerations in assessing the Trust including that it did not meet the requirements of an institution;
  • that the Tribunal had erred in misapplying the legal meaning of institution; and
  • that the Tribunal had erred by taking into account irrelevant considerations in assessing the Trust.

The Court of Appeal dismissed the Commissioner’s appeal in full finding that:

  • The word “institution” takes its ordinary meaning when used in the Act and does not have a narrow technical meaning as posited by the Commissioner.
  • The Foundation, it is capacity as Trustee, was more than a passive trustee – it actually delivered charitable services. Particular reference was made to the fact that the Trustee had developed a curriculum for the delivery of a program that demonstrated that the Trustee had moved from being a mere trust to providing funding for others to provide services consistent with a charitable purpose.  The Court found that “the Trustee was both living and active“.
  • On that basis the Foundation as Trustee qualified to be registered as a charitable institution.

The Commissioner was ordered to pay the Trustee’s costs.

The decision is important for those in the sector because it serves now as a binding authority regarding the interpretation of s.149C of the Act and clarifies that is the Trustee in its capacity as a trustee (and not a trust) which is registered as a charitable institution.